Few things are more satisfying in business than meeting well-planned goals. So late last year, just as I started to revise my plan for 2014, I called E. Michael O’Malley, a business mentor at SCORE.
My question was simple: What are five “big things” a small business owner can do in the coming year that will have lasting impact?
In no particular order, here’s what he suggested:
1. Update your business plan.
Remember that document you sweated to craft? It’s probably moldy in some long-forgotten file. Why not give it new life? O’Malley said.
Your revised plan should be based on the company you own now, not the one you started years ago. Set goals, strategies and timelines for one, three and five years.
“It’s like a roadmap for where you see your business going for the next five years,” O’Malley said. “Use it as a living business document, just as you would a business plan. Most small businesses don’t do that.”
If necessary, he said, seek input from a professional or business mentor.
2. Master the relevant technology.
On Dec. 2, Cyber Monday, online shoppers spent a record $1.735 billion on holiday gifts, an 18.4 percent increase over the previous year. About 29.4 percent of those online sales were mobile, a 61 percent spike over 2012.
With that in mind, O’Malley said small business owners should get serious about mastering the Internet, social media and mobile sales. Despite the explosion of social media as a personal tool, he said, only a fraction of business owners he mentors are using it effectively.
He also said small businesses should re-evaluate their websites, many of which have not been updated in years.
3. Establish a board of advisers.
Too many business owners make decisions in isolation, O’Malley said. The most efficient way to address this problem is to assemble a group of advisers. Nothing fancy, just some friends and business associates with expertise in areas crucial to business management.
Start with your lawyer, bookkeeper, insurance agent and banker, he said. From there, add others with industry-specific knowledge.
“You need to have someone to bounce ideas off of, someone who’s going to challenge you with a provoking question,” he said.
If schedules permit, the group could meet quarterly. Better still, he said, members can be called individually as questions arise.
4. Get to know a banker.
Money is key to any business, and sooner or later, nearly every business will need to borrow some. That’s when it helps to know a banker. If possible, O’Malley said, those relationships should be formed long before a loan is actually required.
O’Malley suggests starting with the bank that holds your business account. He said most bankers are eager to learn about their small business clients.
Business owners with good financials should open a line of credit as a hedge against future needs, he said.
5. Develop a succession plan.
What happens to your business when you are no longer able, or willing, to run it? That question should be asked – and answered – long before the need arises, O’Malley said.
“We assume that because we’ve had two generations of tailors in the family that the third generation is going to want to run that tailor store or be in that business,” he said. “That’s a very bad assumption.”
Not only does a succession plan provide peace of mind, he said, it also can yield significant tax savings if done properly, he said.
O’Malley said business owners should consult with professional estate planners and not attempt to go it alone. He said some banks offer free estate planning for business clients.
Glenn Burkins is editor and publisher of Qcitymetro.com, a news site for Charlotte’s African-American community. He is a former Wall Street Journal reporter and Observer business editor.
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